Parrish

INTRODUCTION

In this case we reaffirm the principle, referred to as the interim adverse judgment rule, that the denial of a dispositive motion on the merits in an underlying action establishes the existence of probable cause and precludes the maintenance of a subsequent malicious prosecution action, unless the prior ruling is shown to have been obtained by fraud or perjury. We hold this principle applies even if the same trial judge later finds that the malicious prosecution defendant initiated the underlying action in bad faith. In a prior litigation, FLIR Systems, Inc. and Indigo Systems Corporation (collectively, FLIR) brought suit against their former employees, William Parrish and E. Timothy Fitzgibbons (collectively, Former Employees) for, among other things, misappropriation of trade secrets (the Underlying Action). Former Employees moved for summary judgment on FLIR’s complaint. The trial court denied the motion, concluding Former Employees failed to satisfy their moving burden and the evidence raised triable issues of fact. The case proceeded to a bench trial, after which the trial court found in favor of Former Employees in the Underlying Action. Moreover, Former…